OLYMPIA – Over 140,000 people in Washington are homeless or unstably housed. A bill to address the affordable housing and homelessness crisis across Washington got its final nod of approval from the Legislature on the last day of the 2019 legislative session. House Bill 1406, sponsored by Rep. June Robinson (D-Everett), would allow counties and cities to use a portion of the state sales tax to leverage local investments in affordable housing.
“Providing a person with stable housing is not only the right thing to do, it is also cost-effective. Local governments are struggling to afford the costs associated with increases in homelessness, and are often only able to put band-aids on the problem,” said Robinson. “This bill will help these local jurisdictions make needed investments in affordable housing and begin to address some of the underlying causes.”
Recent reports have shown that the lack of affordable housing is leading to the increases in homelessness in our region. Each county has unique housing challenges, and HB 1406 will provide flexibility so local jurisdictions can determine what will be the most successful in meeting their needs.
HB 1406 allows counties or cities that opt in to the program to use a portion of the state sales tax for affordable housing or to back bonds dedicated to affordable housing. Such bonds would come at no cost to homeowners, renters, property owners, or developers—an all-around win. If fully utilized, the mechanism in the bill would allow for nearly $400m of bonding capacity in affordable housing.
By incentivizing bonding, the bill aims to stretch a very modest state investment into a significant capital infusion for affordable housing by using local bonding capacity rather than the constitutionally-limited state capacity. The projected fiscal impact to the state general fund is about $52m/biennium.
“Many people who are living unsheltered or in emergency shelters are also struggling with mental illness, substance abuse or both, which has put tremendous pressure on our already broken mental health system,” said Robinson. “This bill will relieve some of that pressure by directly producing transitional and supportive housing for people with mental illness and by shifting focus to prevention rather than providing services only during a crisis.”
The bill passed out of the House and Senate and now heads to the Governor’s desk for his signature.